Hong Kong tram fares to rise to HK$3, a steeper increase than expected, as operator struggles with fall in ridership and shrinking revenue

·4-min read

Fares on Hong Kong’s tram will rise by 15.4 per cent for most riders from next month, with adults paying HK$3 (US$0.38) for a ride, as the operator struggles to cope with a drop in ridership and shrinking revenue amid the coronavirus pandemic.

The revised fares, which take effect on July 11, are slightly higher than the proposed 11.5 per cent increase Hong Kong Tramways applied for last December. The hikes were endorsed by Chief Executive Carrie Lam Cheng Yuet-ngor and her de facto cabinet, the Executive Council, on Tuesday.

The city’s government said in a statement issued on Tuesday that due to competition from other public transport modes, which came amid the prolonged pandemic and the social-distancing measures it triggered, the tram operator had been facing decreasing patronage and revenue since the last fare adjustment in 2018.

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Tram company eyes new range of ‘ding ding’ products to keep service afloat

The profit margin of the company, which the administration said had a unique historical significance and “represented the collective memory of Hong Kong citizens”, had plunged from 18 per cent in 2018 to -1.3 per cent in 2021, and the potential for a further increase from sources of revenue apart from fares was also “rather limited”, a government spokesman added.

“Given [Hong Kong Tramways’] prevailing financial situation, the fare adjustment is necessary for maintaining its financial sustainability,” he said.

Hong Kong’s trams are affectionately known as ‘ding dings’ and have a history that stretches back 118 years. Photo: Dickson Lee
Hong Kong’s trams are affectionately known as ‘ding dings’ and have a history that stretches back 118 years. Photo: Dickson Lee

Fares will rise by 15.4 per cent for both adults and children, from HK$2.60 to HK$3 for the former and from HK$1.30 to $1.50 for young riders. Elderly residents will pay HK$1.30, an increase of 10 cents.

The new monthly ticket will cost HK$260, up from the existing HK$220, while the tourist ticket, which used to cost HK$34, will cease.

Lose that cabin fever on a tram trip across Hong Kong Island

Affectionately known as “ding dings” for the sound of their bells, the trams run along Hong Kong Island and are one of the earliest forms of public transport in the city, stretching back 118 years.

The French-owned tram operator had earlier said its ridership plunged 24 per cent last year as a result of the coronavirus pandemic.

“In addition, sources of revenues from TramOramic and Party Trams have been cut off due to the long halt in the services for anti-pandemic reasons,” it said.

It also said the cumulative rates of fare increase over the past 20 years had been “far lagging behind” the inflation rate, which had grown by over 45 per cent. In comparison, the increase in fares through two adjustments in 2011 and 2018 had only been 60 Hong Kong cents.

Hong Kong’s outgoing leader Carrie Lam Cheng Yuet-ngor had said last month that ensuring the sustainability of the city’s trams was her last mission in her remaining term, which ends in July.

Separately, a source close to the government said talks over a possible pay rise for civil servants was originally on the agenda for discussion at the Exco meeting, but was pushed to the side. The source acknowledge the issue was controversial and the government might want to leave the decision to the next administration.

Several Exco members had earlier expressed shock over the suggestion that senior civil servants receive a pay increase as high as 7.26 per cent, which would be a record.

In a media briefing before the Exco’s weekly meeting, Lam said the pay adjustment mechanism included six factors, such as the inflation rate and pay trends of private companies. .

Additional reporting by Lilian Cheng

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